New FIA Hits the Market with Highest Guaranteed Income Rider
To sign up for information about this soon to be released FIA (and how you can get access to it), click on the following link:
Today, selling an FIA with an income rider has become a spreadsheet exercise. You take the client’s age, you estimate when you think they will want to turn on their income, and then you look for the FIA with the highest guaranteed income (you might also look for an FIA with a stackable income rider that “projects” the highest guaranteed income).
New FIA with highest GIB rider hits the market on Jan. 22nd
With the DOL fiduciary rule, it’s more important than ever to make sure you know about and have access to the “best” FIAs in the market. To do otherwise does a disservice to the client and puts advisors at risk to fiduciary violation lawsuits. As such, EVERY advisor should learn about this soon to be released FIA.
What are the specs of the new product?
-10% first year income bonus
-8% roll-up (simple) for 10 years
-Flexible premium (can add new premium after 1st year)
When you couple a 10% bonus with an 8% roll-up rate (even a simple one) you end up with a product that is tough to beat. Also, almost NO high guaranteed income FIAs are flexible premium products (a key selling point for many clients).
How does it compare? Let’s look at a 60-year old with a $100,000 premium (you can extrapolate the numbers for higher premiums). Below I’ve listed the guaranteed income from the new product and the income from the best other product (A-rated companies only). In years 1-7 the new product has the #1 guaranteed income in the market.
Income after 1 year
$5,228 New Product
$5,150 Great American Product
Income after 3 years
$6,432 New Product
$6,215 American Equity Product
Income after 5 years
$7,500 New Product
$7,399 Lincoln Product
Income after 7 years
$8,632 New Product
$8,500 American National Product
Once you get to years 8-10, the new product is still very close to the top product, but there are one or two that are higher depending on whether the payment begins in year 8, 9, or 10.
For clients who want to go out 10 years or more, they really should be looking at stackable income products that have higher upside potential for income (with a lower guarantee).
Limited distribution product
For good or bad, limited distribution seems to be the trend. This new product is no different. There are only a handful of IMOs in the industry that have access to it. This gives advisors who have access a competitive advantage over their competition.
Start your new year out with the “best” products
As stated above, with the DOL fiduciary rule, it is imperative for advisors to offer their clients the “best” products in the marketplace. Because this new product is literally the #1 product in the market for clients who want a guaranteed income payment for life, there really should be no hesitation about signing up to learn more (it’s every advisor’s duty).
Roccy DeFrancesco, JD